Maintaining a Balanced Organization

Hollywood seems to have a love affair with Zombie movies.  The Walking Dead (which debuted in 2010) has achieved the highest total viewership of any series in cable television history. Wikipedia lists 445 Zombie films, including 94 which have been produced in the last five years alone. All this fascination with Zombies reminds me of a business lesson I learnebusiness-zombiesd about the danger of becoming a “Zombie Business.”

Staying one step ahead of your competition is a difficult task in today’s environment. There is little we can do to create competitive advantage that can’t be swiftly imitated.  Yet many business and department leaders become comfortable with success, and react by modifying the behaviors that made them successful in the first place.  They often choose to forgo a higher level of accomplishment by seeking to preserve the contentment of the status quo.

Sydney Finkelstein, the Steven Roth Professor of Management and Director of the Center for Leadership at the Tuck School of Business at Dartmouth College, wrote the 2003 business best seller – Why Smart Executives Fail (And What You Can Learn From Their Mistakes).

Professor Finkelstein defines a “Zombie Business” as one which “has created an insulated culture that systemically excludes any information that could contradict its reigning picture of reality.” These businesses:

Continue to do business the way they always have – actively deluding themselves into believing that all is well – people effectively avoid facing reality;

Are usually happy zombies – blissfully unaware that they are in the middle of a major business disaster until after it has unfolded; and

Embrace “Company policies” and “Company attitudes” that are ultimately mind-numbing; a cumulative effect of so many small and seemingly benign policies that are destructive.

Finkelstein notes that “the more successful a company has been in the past, the harder that company will find it to change the model that made it a success. Instead of trying to achieve something beyond itself, the company starts trying to maintain its own status.”  Furthermore, he warns against positive attitudes.  “Positive attitudes are a wonderful way to avoid facing reality. Company executives might keep things running smoothly, but they won’t be able to introduce more disruptive innovations necessary to keep the company competitive over the long haul.”

So what can you do to prepare your department or entity from being consumed by a Zombie-Business-Apocalypse? Professor Finkelstein offers the following suggestions:

Protect your Company from Company Pride – Avoid excessive pride – if you want to prevent your company from turning into a zombie, you have to counteract any tendency on the part of employees to congratulate themselves too often.

Protect your Company from its own Idea of Excellence – to reinforce this kind of thinking, it is extremely helpful to make each executive personally responsible for dealing with real customers.

Protect your Company from its Positive Attitude – Make heroes of the “Paul Revere’s” who ride through the company warning that “The British are Coming.”  Of course, it is important to distinguish these “Paul Revere’s” from “Chicken Little’s” who ride through the company announcing that the sky is falling. The “Paul Revere’s” are not spreading doom and gloom, but prompting people to take proactive, cost-effective actions.

Protect your Company from Perfectionism – Change goals whenever the old goal is being fully met, not just “raise the bar.”  There is risk in constantly looking for incremental improvements in old models that may no longer be the right ones given changing competitive and customer dynamics. Measure by external benchmarks rather than by some internal standard.

Protect your Company from too much Team Spirit – Counteract the groupthink associates with too much team spirit.  Foster and preserve any opinions that differ from the prevailing one.  Create cross-functional teams and diverse work groups whose members will see things differently. Appeal to outsiders – sometimes outsiders can make valuable contributions to an organization’s thinking simply by asking questions.

These recommendations seek to achieve organizational balance. Celebrating success and team spirit is important in any business environment.  Too many detractors make for a negative workplace and distinguishing “Paul Revere’s” from “Chicken Little’s” can be exhausting.  Follow Professor Finkelstein’s suggestions to prevent complacency and inertia from preventing progress. Embrace the balancing act and avoid the Zombie-Business-Apocalypse for your organization or department.

Is your success contributing to Zombie behaviors for your company? I would love to hear your tips and suggestions for avoiding a Zombie-Business-Apocalypse destiny.

 
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